Trump’s 17 Demands for Rate Cuts: Why Powell Isn’t Playing Along

The Great Rate War: Politics vs. Data

Let me be precise: Donald Trump has publicly demanded that Federal Reserve Chair Jerome Powell lower interest rates at least 17 times since January 2025. That’s an average of one demand every few days—some days even twice.

He calls Powell ‘Too Late先生’—a nickname born from frustration over inaction. But here’s the irony: while Trump shouts for cuts, he himself drove much of the macroeconomic tension with sweeping tariffs that spiked import costs.

As a crypto analyst who tracks monetary policy through Python-driven models, I see this not as a personal feud but as a clash between raw politics and cold economic reality.

Why Does Trump Want Lower Rates?

Let’s break it down:

• To offset tariff pain: His own trade war increased prices on electronics and machinery. Lower rates could help absorb those shocks.

• To slash debt servicing: The U.S. government pays over \(776 billion annually in interest—a 7% rise from last year. Trump claims cutting rates by just 2% could save \)800 billion yearly.

• To boost markets: He loves bull runs—especially before elections. Lower rates fuel liquidity, driving equity gains.

But here’s where it gets messy: if you’re the architect of inflationary pressure (via tariffs), then blaming your central bank for not fixing it is like blaming your doctor after eating too much fast food.

Why Isn’t Powell Cutting Rates?

The data says no—not because he wants to frustrate Trump, but because he sees stability where Trump sees crisis.

Here are the facts:

• Unemployment remains at 4.5%, near historic lows.
• Hourly wages still grow at ~4% YoY.
• GDP dipped slightly (Q1 -0.3%), but core consumption and business investment held steady at 1.5%-2% growth.
• Inflation is falling across goods—from groceries to gasoline—and services inflation is moderating.

Powell isn’t blind to these signals—he lives on them. And his message is clear: “We’re not seeing enough distress yet to justify loosening policy.” The Fed follows a data-dependent mandate—not a political one.

Even some Republicans agree: Vice President Vance called Fed inaction “monetary malpractice.” But they also know that premature cuts risk reigniting inflation—or worse—undermining confidence in Treasury bonds.

Markets Are Betting on September or December Cuts

Despite all this noise, financial markets are quietly pricing in two rate cuts by year-end: in September and December (per CME Group futures). The consensus? Wait until labor markets show clearer signs of softening—which many economists expect by Q4 due to housing sector stress and elevated mortgage rates..

My model predicts only one cut in 2025—at 25 basis points—but with potential for deeper easing into 2026 if unemployment climbs above 4.8% or CPI stays below 3% for three consecutive quarters.